8/16/2010 @ 3:01PM

Stocks Lose Steam

Stocks lost their steam Monday afternoon after spending much of the day to the upside.

By afternoon trading the Dow Jones industrial average fell 0.3% to 10,271 points, the S&P 500 index 0.3% to 1,076 points and the Nasdaq composite index 0.1% to 2,172.

Investors were discouraged by the latest reading of homebuilder confidence, which fell for the third consecutive month in August. On Monday the National Association of Home Builders announced its homebuilder sentiment index fell to 13, the lowest reading since March 2009. The
SPDR S&P Homebuilder
exchange-traded fund decreased 0.5%, with
D.R. Horton
,
PulteGroup
,
KB Home
and other homebuilding names trading to the downside.

For-profit education firms continued to be battered Monday. The sector has been pressured for some time now due to concerns about enhanced regulation, but tensions were heightened Friday after the Department of Education expressed its interest for greater resourced in order to conduct an inquiry into fraud. (See “For-Profit Education Feels More Washington Heat.”)

The sell-off continued on Monday after a government report found that many of its students aren’t paying back their school loans, possibly crippling their ability to receive federal financial aid, which is where a significant amount of the schools’ sales come from. By afternoon trading shares of
DeVry
dropped 9.2%,
Career Education
5.3%,
Corinthian Colleges
22.%, and
Education Management
19.5%.

Shares of
Dell
slowly worked its way downward on Monday after it announced it was acquiring data storage equipment maker firm
3Par
for $1.3 billion. Shares of the computer-maker decreased 1% by afternoon trading, while rest of the tech sector was mixed, as
Hewlett-Packard
and
Microsoft
traded to the upside, while
Apple
,
IBM
and
EMC
were in the red.